Some analysts said the selloff in stocks pointed to "deep-seated worries" among investors.

"Fact is, a rollcall of crises appear to be bubbling up — from Italian politics to Brexit to US-China conflict — threatening to blow out rather than blow over," Vishnu Varathan, head of economics and strategy at Mizuho Bank, wrote in a morning note.

"Global policy-makers do not appear to have plans that make the cut for resolving these," Varathan added.

Japan, Australia and China shares fall

Japan's Nikkei 225 dropped 0.28% to 20,618.57, retracing some of its earlier losses, and the Topix index declined 0.61% to 1,497.51.

The Japanese yen traded at 106.54 against the dollar, weakening from levels below 106 in the previous week.

In South Korea, the Kospi index erased losses to trade 0.22% higher at 1,964.65 and Kosdaq was up 1.47%. Major stock indexes in India, Singapore and Indonesia also traded lower in the afternoon.

Hong Kong's Hang Seng index rose about 0.2% in late afternoon trade while shares of Xiaomi tumbled 4.98%. The Chinese smartphone maker, which is listed in Hong Kong, reported 15% growth in quarterly revenue on Tuesday, missing estimates as fewer people bought smartphones at home, and as rival Huawei grabbed more market share, Reuters reported.

The Shanghai composite on mainland China was fractionally higher at 2,880.33 while the Shenzhen composite was down about 0.1%. The onshore Chinese yuan traded at 7.0591 against the dollar after the People's Bank of China set the daily midpoint rate at 7.0433, slightly stronger than a Reuters estimate.

Offshore yuan, which is traded outside mainland China and has comparatively fewer restrictions, traded at 7.0643.

"Markets traded on little news flow as investors await guidance from central bankers into the end of the week," Adelaide Timbrell said in an early morning note, pointing to policy meeting minutes that are due from the U.S. Federal Open Market Committee and the European Central Bank.

"His remarks will be closely monitored for hints that more policy easing is in store, against the backdrop of ongoing trade tension," Timbrell wrote, adding that markets are expecting the Fed to cut rates by 25 basis points at its next meeting in September.

Oil prices rose Wednesday morning during Asian trading hours. U.S. crude added 0.3% to $56.30 per barrel while the international benchmark Brent gained 0.62% to $60.40.